International Messengers (Nig.) Ltd. V. Pegofor Industries Limited (2005)

LAWGLOBAL HUB Lead Judgment Report

EDOZIE, J.S.C.

The respondent and appellant were respectively plaintiff and defendant before the Onitsha High Court in suit No. 0/31/92. The plaintiff, a company engaged in the manufacture of industrial gas had a chemical plant in Onitsha which was installed by an Italian company (Siad Machine Impianti Company of Bergano, Italy). A vital component, the machinery consisting of piston and rod assembly was faulty and needed to be transmitted urgently by air to the said Italian company in Italy for necessary repairs.

On 8th November, 1991, the plaintiff, through its Managing Director handed over a package of the faulty component to the defendant, an air courier company, at its office in Onitsha for transmission to the Italian company for repairs and return by 15th November, 1991 so that the machinery could resume production the next day. In consideration of the transportation, the plaintiff paid the sum of N2, 110.00 to the defendant and was issued with a receipt thereof and an Airway bill by the defendant’s employee who received the package. The Airway bill which was signed by the plaintiff contained an exemption or limitation clause which limited the liability of the defendant to the sum of N500 in the event of loss or damage of the good. The package eventually got lost and the defendant by its letter of 5th December, 1991 notified the plaintiff to that effect. To minimise its loss, the plaintiff, by telex, placed an order for a complete new component which was delivered on 21/12/91 at a cost of US N28, 000.00 dollars. Thereupon, it commenced an action against the defendant for breach of contract of bailment claiming a total sum of N1,500,000.00 (one million, five hundred thousand naira) particularised in paragraph 16 of its statement of claim as follows:

“(i) Value of the complete piston and rod assembly at

current rate of exchange $25,000.00 or N417, 500.00

(ii) Charge paid for carriage N2, 110.00

(iii) Loss of earning from 16/11/91 to 20/12/91 (35 days)at N15, 000 per day N525, 000.00

Total special damage N944, 610.00

General damages N555.390.00

Total N1.500.000.00.”

The defendant admitted responsibility for the loss of the package but relying on the exemption clause contained in the Airway bill contended that as the Airway bill formed the contractual relationship between the parties, its liability to the plaintiff was limited to N500.

After the exchange of pleadings but before trial, counsel for both parties jointly filed in court, a document titled “Settlement of Issues” admitted in evidence as exhibit ‘A’ wherein they set out facts agreed upon as relevant to the case and also relevant documents admitted by consent including the receipt for N2,110.00 and the Airway bill subsequently admitted in evidence as exhibits B and C respectively. In the said “Settlement of Issues” exhibit ‘A’, the parties stated that the only issue the court should determine was whether, having regard to the Airway bill, exhibit ‘C’, the defendant’s liability was limited to N500, and they further agreed that if the court

determined the issue negatively, the plaintiff should proceed to prove its loss.

At the trial, each party called one witness and after taking the addresses of counsel, the learned trial Judge, Ononiba, J., held that the defendant was liable to indemnify the plaintiff to the full extent of its loss. Adverting to the quantum of damages upon which evidence had been led, the learned trial Judge referred to section 920(a) of the Anambra State Contract Law, Cap. 30, Laws of Anambra State, and held that the plaintiff was entitled to the full value of the lost component which he assessed at N417, 500.00. He also adjudged the plaintiff entitled to the refund of the sum of N2,110.00 paid as freight. In all, he awarded the plaintiff a total sum of N419, 610 with N2,000 costs. The claim for consequential damages and general damages were disallowed.